Close on the heels of the Department of Justice’s record-breaking fiscal year 2014 comes the latest Medicare fraud settlement involving Massachusetts-based North Atlanta Medical Services d/b/a Regional Home Care, Inc. The case, which was commenced by two former employees of NAMS, resulted in a settlement of $852,378. The two whistleblowers will receive $153,428 to share, and the Commonwealth of Massachusetts will receive $229,210 to cover its losses incurred as a result of the fraud involving Medicare and Medicaid patients, which is a program funded by both state and federal funds.

Details of case against NAMS

NAMS is a medical product manufacturer and distributor located in Leominster, Massachusetts. The company specializes in producing equipment useful for the treatment of respiratory conditions, including sleep apnea and oxygen deficiency. According to allegations, for a period spanning from September 2010 through January 2013, NAMS was conducting its business in a manner incongruent with the licensing requirements of Medicare and Medicaid. More specifically, both programs maintain a requirement that suppliers of respiratory therapy equipment obtain a license to engage in respiratory therapy. Likewise, the Massachusetts Department of Public Health maintains a similar licensure requirement for any individual working as a respiratory therapist. In order to obtain such a license, an applicant must be certified by the National Board of Respiratory Care, hold a degree in respiratory therapy, and pass a criminal background check. Working as a respiratory therapist without a license is not only a violation of state law, but triggers False Claims Act liability with regard to any therapy services provided to Medicare, Medicaid, or TRICARE patients eligible for coverage.

Allegedly, during the time period in question, NAMS allowed unlicensed employees to set up sleep apnea and oxygen therapy machines for patients across Massachusetts. What’s more, NAMS received a stern warning from the Department of Public Health that its conduct was illegal, and it continued to allow unlicensed personnel to work with patients nonetheless.

Government’s comments

A United States Attorney for the District of Massachusetts said in a statement:

“This respiratory care company flouted important licensure requirements, failed to provide patients the standard of care that they deserve and fraudulently billed the federal government for improperly rendered services….With the important assistance of whistleblowers, our health care fraud team seeks to ensure patient safety and protect the public fisc.”

The Department of Health and Human Services likewise commented:

“To safeguard patient health and ensure that taxpayer money is spent well, Medicare and Medicaid require providers of respiratory care services to follow state licensure rules….Companies seeking to boost profits by using unlicensed personnel will be held accountable for their actions.”

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